Debt Management and Your Credit Score

Does Opening a Bank Account Affect Your Credit Score?

Learn how to boost your credit score through your current account with our detailed guide

A woman looking at her credit rating report which is 765 'Excellent'

Opening a bank account will not affect your credit score unless the bank conducts a hard credit check which is typically reserved for bank accounts that provide overdrafts.

You’re keen to open a new bank account but pause, worrying it might dent your credit score. Surprisingly, the mere act of opening a bank account typically doesn’t flicker on your credit radar.

This post unpacks the myths and truths about ban accounts and their play with your creditworthiness. Dive in – There’s clarity ahead!

The Difference Between Soft and Hard Credit Checks

A soft credit check happens when a person or company checks your credit score as part of a background check. Soft credit checks are conducted when you’re getting pre-approved for offers from lenders or when you’re checking your own score.

Importantly, soft credit checks do not affect your credit score at all because they are not tied to an actual application for new credit.

On the other hand, a hard credit check is more serious and is typically done when you apply for something like a mortgage, loan or credit card. Lenders do this kind of deep dive into your financial history to decide how risky it would be to lend you money.

Each hard credit check will slightly lower your credit score for a short period since it suggests that you are seeking additional debt.

For more information on soft and hard credit checks, check out Suits Me’s expert guide.

Does Opening A Saving Account Or Current Account Affect Your Credit Score?

The good news is that simply opening a savings or current account won’t impact your credit score directly. What can have an impact, however, is how you manage these accounts and any associated overdrafts.

In fact, companies like Suits Me offer basic accounts with no credit checks required.

Now, while the act of opening the account itself won’t ding your score, it’s how you manage the account that can have implications. Overdrawing on your current account or failing to meet agreed overdraft limits can result in negative marks on your credit history.

Responsible use of direct debits and ensuring sufficient funds are present can help maintain a healthy financial record without harming your credit score.

How Is Your Credit Score Calculated?

As you may be aware, a credit score can significantly affect your financial life. It directly influences whether a lender will offer you credit, how much credit they will offer you and how much money you’ll likely pay back in interest.

Your score is calculated by evaluating the following five factors:

  • Your payment history – Whether you’ve ever missed or been late with making repayments (this counts towards 35% of your credit score)
  • The total amount of money you owe – All your outstanding debts on other bank cards, loans, overdrafts or credit plans (this accounts towards 30% of your credit score)
  • The length of your credit history – Longer credit histories are considered less risky as there’s more data to determine spending habits and previous payments (this counts towards 15%)
  • The types of credit you have – This gives lenders information on instalment credit, mortgages, car loans and revolving credit like credit cards (this counts towards 10% of your total score)
  • Any new credit you may have taken out – big jumps in credit can be a warning sign to lenders as it could signal a change in your financial position (this also counts towards 10% of your credit score)

When information is updated on an individual’s credit report, their credit score will either rise or fall. To learn how to check your credit score, read Suits Me’s detailed how-to guide.

Looking over a mans shoulder who is viewing their credit score which is 811 'Excellent'.  Over the image is a pink and green gradient.

3 Easy Ways to Improve Your Credit Score

It can take from anywhere to a few weeks, months or years to notice changes to your credit score but there are some small things that you can do to help:

1. Use Direct Debits To Pay your Bills on Time

It might sound like an obvious thing to do but paying your bills on time is a sure way to build your credit score. Six months of payments made on time will result in a noticeable difference to your score (you’ll probably also avoid a late fee!). To do this it’s worth setting up a standing order or direct debit to ensure your bills are never paid late.

However, it’s worth noting that you do need around a 16-month gap from any missed payments to see your score be fully optimised and back in the green.

2. Up your Credit Line

This doesn’t mean opening new credit accounts but increasing the ones you already have. If you have a credit card, overdraft or instalment plan and your account is in good standing, you should be able to get an increase (if you’re not already at the limit).

However, it’s important not to spend any extra credit to keep your credit utilisation score low and prevent yourself from getting into any financial difficulties.

3. Keep Credit Accounts Open

Depending on the age of the account and the limit available, it can actually do more harm than good to close the account. So, if you’re no longer using a certain credit card or overdraft facility, it’s best to make sure the account is fully paid off and left open – rather than closing it down. 

In the UK, the average credit limit is between £3000 and £4000, you should aim to have a credit limit of £4000+. This will help with your score, as you will be considered ‘better than average’ with lenders.

So, for example, if you had £1000 worth of debt and a £5000 credit limit across all your lines of credit, this is good for your credit score as your credit utilisation is around 20%.

However, if you decided to close one of your accounts that had a £2000 credit limit but the debt remained the same then you would be using 33% of your total amount of credit – well over the recommended 25% limit.

Common Mistakes Which Lower Your Credit Score And How To Avoid Them

Some financial behaviours can prevent your credit-building efforts, so it’s important to understand what to avoid.

Joint Accounts With Low-Credit Scorers

If you have or have ever had a joint bank account with your partner, friend, or family member, whose credit score is poor, then this can affect your own.

Having a joint account means you’ll be ‘co-scored’, as both your names will appear on the account together. If you’re looking to borrow credit in the future, lenders will not only check your credit score but also the score of whoever you share the joint account with.

If you no longer use your joint account and want to remove the financial association on your credit score, you will need to contact your banking provider to remove the other person as a secondary user on your current account.

Once you’ve done this, it’s worth checking with each credit reference agency (Experian, TransUnion, and Equifax) that the links between you and your friend or family member have been removed.

Not Being Consistent With Your Contact Details

Issues with your address can cause mistakes on your credit file. Even a slightly wrong address can affect your rating. Credit reference agencies use your address to help match your credit information, so if your address is out of date or incorrect, it can lead to incomplete information appearing on your credit report.

You should ensure that the details you have with your bank are correct and if they need updating you should contact your banking provider as soon as possible. It can take a month or two for this change to appear on your report, but it will help to boost your score in the long run.

Frequently Switching Bank Accounts

Switching banks frequently doesn’t directly hurt your credit score. However, it may raise questions with lenders about why you’re changing banks so often. They may wonder whether there were issues with overdrafts at previous banks that led you to make the switch, which in turn can indirectly impact how they view your financial stability and trustworthiness when considering you for credit.

Keep this in mind and ensure smooth transitions between accounts without leaving a trail of unresolved debts behind.

Leaving Your Account Overdrawn

Overdrawing your bank account can lead to credit score issues if not addressed quickly. If you rack up fees and fail to settle them, the bank might report your negative balance to credit agencies.

This can knock points off your credit score. You want to avoid that because a lower score could affect future loans or even job applications.

Protecting Your Credit Score with a Suits Me Personal Account

You can open a Suits Me account right now without affecting your credit score. Suits Me aims to help people with bad credit open personal accounts, that’s why we do not require credit checks.

Suits Me accounts come with a contactless Mastercard® debit card, online account, and a mobile app – so you can manage your finances 24/7. You can create standing orders and manage your direct debits with ease to ensure that you never miss a payment. To find out more about the type of accounts provided by Suits Me, including our cashback and reward options, click the link.


1. Will opening a new bank account affect my credit score?

Opening a new bank account itself typically doesn’t affect your credit score, but the bank’s actions, like running a hard credit check, will have a temporary impact.

2. Can setting up direct debits improve my credit score?

Yes, consistently managing direct debits can show responsible financial behaviour, which may improve your credit score over time.

3. Does how I use my bank account influence any increase in my credit score?

Regularly using your bank account responsibly and ensuring all payments are made promptly through direct debits can positively contribute to an increase in your credit rating.

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